Plans by Coal India to buy billions of dollars of new machinery and outsource work are facing resistance from powerful unions worried about job losses, in a potential blow to Prime Minister Narendra Modi’s promise to bring electricity to all.
State-run Coal India Ltd, the world’s biggest coal miner, has already doubled output growth since Mr Modi came to power two years ago, owing to the removal of hurdles to production like environmental clearances and land acquisition.
The increase turned coal shortages at India’s power plants to oversupply, making it one of the administration’s biggest successes.
The next phase of restructuring the notoriously inefficient behemoth is likely to be harder, however, and is crucial to the government’s ambition to sell 10 per cent of the $27 billion company to raise funds for further growth and investment.
The government wants to double annual output to one billion tonnes by 2019-20 to meet future demand, and to do that it must radically increase productivity.
Already, labour unions, with a history of hostility towards management, are pushing back on Coal India’s plans, fearing modernisation and outsourcing will hit jobs, said leaders of two unions that cover a majority of the company’s 371,000 employees.
“High-tech mining will mean fewer job opportunities for labourers and no job guarantee for existing employees,” said Baij Nath Rai, president of Bharat-iya Mazdoor Sangh (BMS), which says it represents 100,000 Coal India employees and contractors.
“We strongly protest this, and have already taken up the issue with the government. They will not dare do anything if there is a strong protest.”
The BMS’s view is likely to carry extra weight, as it is loosely affiliated with the Rashtriya Swayamsevak Sangh (RSS).
Mr Rai said Piyush Goyal, minister for power, coal and renewable energy, had been trying to convince unions to play along with the reforms.
Coal India officials also say they constantly talk to workers on various issues, but union leaders, including BMS’s Rai, said they would resist any move deemed “anti-labourer”.
“The government is doing this slowly, so that there is not much protest all of a sudden,” said D.D. Ramanandan of the All India Coal Workers Federation, which says it represents more than one lakh of Coal India employees and contractors.